Dilemmas of the Ocean Logistics

Ocean Logistics, as the name suggests, is transportation of Cargo over ocean from one port to another. Obviously, the large ships play major role of transportation over ocean. The industry broadly can be categorised as Oil Tanker, Dry Bulker. and Container. We will discuss on the first two categories.

The tanker and bulker take the major percentage of total business across the world. It’s a huge capital intensive business, as each ship usually cost at range starts from USD 10 million to USD 80-90 million plus and average ROI at the range of 8-9 yrs. On top of those, it requires huge shipping expertise to exist in the market. Shipping market is fully driven by international factors like Crude Oil price up &down, Chinese economic growth etc.

This industry attracted me, after spending many years in FMCG, BFSI sector because the IT usage was very low in comparison with other industries and there exists huge scope to really make the industry more technology driven.

I realised that the IT revolution actually happened on land in the last two decades or more but hardly anything happened in the sea.

In the shipping industry all ships are equivalent to floating branches; how it can be efficiently controlled without Internet connectivity, from shore, is the question

Historically, all Europeans started sailing and discovering unknown lands. The Europeans still tried to implement IT little bit but in India, it is far behind compared to other industries. There is no proper Internet connectivity available in Indian ship, a very limited 256 kbps broadband connectivity is there and we have huge constraint to manage ships remotely. Indian Govt. does not allow VSAT connectivity on Indian ships which can bring better connectivity and more bandwidth, citing security reason, as a result of which the bandwidth constraint prevails till date.

Today we cannot even think of working in an organization where all my branch offices are not connected. Similarly in the shipping industry all ships are equivalent to floating branches; how it can be efficiently controlled without Internet connectivity, from shore, is the question.

As a result, not many software products are available internationally to cater the industry’s day to day requirements. Some products are there from European based companies but they are running behind the show on their technological platform used which is quite outdated now. As the industry is much different in operations than other industries, no good standard ERP product is available. The regular ERP product like SAP will not fit the industry requirement. There exists a huge scope of IoT in this industry, as the shore staffs need to monitor, guide and track the ships 24/7 in any time zone remotely. IoT can even produce the ship’s engine’s dash board live on the desktop at shore office, which can be monitored to guide the people on board to get the most efficient way of running the ship and in turn save huge fuel cost.

Headquartered in Mumbai, India, and founded in 1948, The Great Eastern Shipping [BSE: 500620] is a private sector shipping service provider operating globally. The shipping giant operates under two main businesses: dry bulk carriers and tankers.